Jerome Powell, who was sworn in as chief of America’s Federal Reserve this week, faces a baptism of fire.
Articles written by Andrew Van Sickle
Investors have had a fright. As US wages are climbing at an annual rate of 2.9%, it may not be long before inflation rises much faster than its current 2.1% year-on-year pace.
Deal-making often accelerates close to the top of a cycle. So it could bode ill that January marked the strongest start to a year for global mergers and acquisitions (M&A) since the peak of the dotcom boom in 2000.
Since early 2016 the MSCI Emerging Markets index has jumped by 83%, and is now close to its 2007 all-time high. Last week, global investors poured $7.9bn into emerging-market equity funds.
Asia’s best-performing stockmarket last year was Vietnam, where consumer and manufacturing firms were the key drivers of a 48% increase in the Ho Chi Minh Stock index.
The pound has perked up. Last week it jumped to $1.43, the highest level since the referendum on leaving the EU.
US equities have enjoyed a ‘‘Trump bump’’ since the 45th president took office. The US dollar, which is close to a three-year low, hasn’t.
Brazil’s Bovespa stockmarket index has just reached a new record peak, but investors should keep a close eye on the political backdrop.
Last week Congress failed to approve a bill to continue funding government operations. But US equities have largely ignored the fuss, hitting yet more record highs.
Turkish stocks have just reached a new record.But with high debt, a weak lira and an authoritarian government, Turkey’s boom could quickly turn to bust.